L:\secdraft\version3\exhib99.doc3
EXHIBIT 99
HUGHES ELECTRONICS CORPORATION AND SUBSIDIARIES
CONSOLIDATED FINANCIAL STATEMENTS AND
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
CONSOLIDATED STATEMENT OF INCOME AND
AVAILABLE SEPARATE CONSOLIDATED NET INCOME
(Unaudited)
Three Months Ended
March 31,
1997 1996
(Dollars in Millions
Except Per Share Amounts)
Revenues
Net sales
Outside customers $2,765.7 $2,438.9
General Motors and affiliates 1,362.5 1,174.7
Other income - net 24.5 123.1
-------- --------
Total revenues 4,152.7 3,736.7
------- -------
Costs and expenses
Cost of sales and other operating charges, exclusive of
items listed below 3,216.8 2,796.5
Selling, general, and administrative expenses 440.5 300.3
Depreciation and amortization 146.1 131.6
Amortization of GM purchase accounting adjustments
related to Hughes Aircraft Company 30.6 30.6
Interest expense - net 3.9 5.2
--------- ----------
Total costs and expenses 3,837.9 3,264.2
------- -------
Income before income taxes 314.8 472.5
Income taxes 110.2 191.4
----- -----
Net income 204.6 281.1
Adjustments to exclude the effect of GM purchase accounting
adjustments related to Hughes Aircraft Company 30.6 30.6
------ ------
Earnings Used for Computation of Available Separate
Consolidated Net Income $235.2 $311.7
Available Separate Consolidated Net Income
Average number of shares of General Motors Class H
Common Stock outstanding (in millions) (numerator) 100.4 97.4
Class H dividend base (in millions) (denominator) 399.9 399.9
Available Separate Consolidated Net Income $59.1 $76.0
==== ====
Earnings Per Share Attributable to General Motors Class H
Common Stock $0.59 $0.78
==== ====
Reference should be made to the Notes to Consolidated Financial Statements.
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HUGHES ELECTRONICS CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
March 31,
1997 December 31,
(Unaudited) 1996
(Dollars in Millions
Except Per Share Amount)
ASSETS
Current assets
Cash and cash equivalents $893.0 $1,161.3
Accounts and notes receivable
Trade receivables (less allowances) 1,291.9 1,200.6
General Motors and affiliates 116.8 113.4
Contracts in process, (less advances and progress
payments) 2,661.0 2,507.1
Inventories (less allowances)
Productive material, work in process, and supplies 1,439.9 1,383.1
Finished product 172.4 145.4
Prepaid expenses, including deferred income taxes 737.6 568.1
Total current assets 7,312.6 7,079.0
Property-net 2,879.4 2,886.6
Telecommunications and other equipment - net 1,168.4 1,133.5
Intangible assets - net 3,522.7 3,466.0
Investments and other assets - principally at cost
(less allowances) 1,858.7 1,915.0
Total assets $16,741.8 $16,480.1
======== ========
LIABILITIES AND STOCKHOLDER'S EQUITY
Current liabilities
Accounts payable
Outside $1,008.9 $896.4
General Motors and affiliates 22.4 27.5
Advances on contracts 850.3 868.9
Notes and loans payable 634.9 248.1
Income taxes payable 189.2 132.9
Accrued liabilities 1,641.8 2,025.8
------- -------
Total current liabilities 4,347.5 4,199.6
------- -------
Long-term debt and capitalized leases 31.3 34.5
Postretirement benefits other than pensions 1,668.4 1,658.9
Other liabilities and deferred credits 1,407.5 1,407.2
Stockholder's equity
Capital stock (outstanding, 1,000 shares, $0.10 par value)
and additional paid-in capital 6,355.3 6,347.2
Net income retained for use in the business 3,073.4 2,968.8
------- -------
Subtotal 9,428.7 9,316.0
Minimum pension liability adjustment (113.5) (113.5)
Accumulated foreign currency translation adjustments (28.1) (22.6)
Total stockholder's equity 9,287.1 9,179.9
------- -------
Total liabilities and stockholder's equity $16,741.8 $16,480.1
Reference should be made to the Notes to Consolidated Financial Statements.
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HUGHES ELECTRONICS CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
Three Months Ended
March 31,
1997 1996
(Dollars in Millions)
Net cash used in operating activities $(281.6) $(13.1)
----- ----
Cash flows from investing activities
Investment in companies, net of cash acquired (143.3) (28.7)
Expenditures for property and special tools (103.3) (135.3)
(Increase) decrease in telecommunications and other
equipment (56.9) 22.1
Proceeds from sale and leaseback of satellite
transponders with GMAC - 252.0
Proceeds from disposal of property 22.9 16.7
Decrease (increase) in notes receivable 10.3 (2.2)
Net cash (used in) provided by investing activities (270.3) 124.6
Cash flows from financing activities
Net increase (decrease) in notes and loans payable 386.8 (316.1)
Increase in long-term debt 7.4 10.3
Decrease in long-term debt (10.6) -
Proceeds from sale of minority interest in subsidiary - 137.5
Cash dividends paid to General Motors (100.0) (96.0)
Net cash provided by (used in) financing activities 283.6 (264.3)
Net decrease in cash and cash equivalents (268.3) (152.8)
Cash and cash equivalents at beginning of the period 1,161.3 1,139.5
Cash and cash equivalents at end of the period $893.0 $986.7
Reference should be made to the Notes to Consolidated Financial Statements.
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HUGHES ELECTRONICS CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
NOTE 1.
The accompanying unaudited consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial information. In the opinion of management, all adjustments (consisting
of only normal recurring items) which are necessary for a fair presentation have
been included. The results for interim periods are not necessarily indicative of
results which may be expected for any other interim period or for the full year.
For further information, refer to the consolidated financial statements and
notes thereto included in General Motors' 1996 Annual Report on Form 10-K.
NOTE 2.
Other income - net for the first quarter of 1996 includes a $120.3 million
pre-tax gain from the sale of a 2.5% equity interest in DIRECTV(R) to AT&T.
NOTE 3.
During the first quarter of 1997, the Company's DIRECTV(R) subsidiary changed
the amortization period for certain subscriber acquisition costs related to a
consumer rebate and manufacturers' incentive program. Based on guidance from the
staff of the Securities and Exchange Commission, the period over which such
costs are amortized has been reduced from three years to one year. The
amortization period is now equal to the length of the subscriber's prepaid
programming commitment. The effect of this change on prior periods was not
material.
NOTE 4.
On January 16, 1997, GM and Hughes announced a series of planned transactions
designed to address strategic challenges and unlock stockholder value in the
three Hughes business segments. The transactions would include the tax-free
spin-off of the Hughes defense business to holders of GM's $1-2/3 par value and
Class H common stocks, followed immediately by the tax-free merger of that
business with Raytheon Company. The spin-off will not be proposed in a manner
that would result in the recapitalization of Class H common stock into $1-2/3
par value common stock at a 120% exchange ratio, as currently provided for under
certain circumstances in the GM Restated Certificate of Incorporation, as
amended. At the same time, Delco Electronics, the automotive electronics
subsidiary of Hughes, would be transferred from Hughes to GM's Delphi Automotive
Systems unit. Finally, GM's Class H common stock would be recapitalized into a
GM tracking stock linked to the telecommunications and space business of Hughes.
No assurance can be given that the above transactions will be completed;
however, management of GM and Hughes and GM's Board of Directors expect to
solicit stockholders' approval of the planned transactions in late 1997, after
certain conditions are satisfied.
In September 1996, Hughes and PanAmSat Corporation entered into an agreement
to merge their respective satellite service operations into a new publicly-held
company. Hughes would contribute its Galaxy(R) satellite services business in
exchange for a 71.5% interest in the new company. Current PanAmSat stockholders
would receive a 28.5% interest in the new company and $1.5 billion in cash. Such
cash consideration and other funds required to consummate the merger are
expected to be funded by new debt financing totaling $1.725 billion. This debt
financing is expected to be provided by Hughes, which currently intends to
borrow such funds from GM. The transaction is expected to close during the
second quarter of 1997.
NOTE 5.
Earnings per share attributable to General Motors Class H common stock was
determined based on the Available Separate Consolidated Net Income (ASCNI)
of Hughes divided by the weighted average number of common shares outstanding.
Holders of GM Class H common stock have no direct rights in the equity or
assets of Hughes, but rather have rights in the equity and assets of GM (which
includes 100% of the stock of Hughes).
The ASCNI of Hughes for any quarterly period represents the separate
consolidated net income of Hughes for such period, excluding the effects
of GM purchase accounting adjustments arising from the acquisition of Hughes
Aircraft Company (Earnings Used for Computation of Available Separate
Consolidated Net Income), calculated for such period and multiplied by a
fraction, the numerator of which is a number equal to the weighted average
number of shares of GM Class H common stock outstanding during the quarter and
the denominator of which was 399.9 million during the first quarters of 1997
and 1996.
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HUGHES ELECTRONICS CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - concluded
(Unaudited)
NOTE 6.
Hughes has disclosed in the financial statements certain amounts associated
with estimated future postretirement benefits other than pensions and
characterized such amounts as "accumulated postretirement benefit obligations,"
"liabilities," or "obligations." Notwithstanding the recording of such amounts
and the use of these terms, Hughes does not admit or otherwise acknowledge that
such amounts or existing postretirement benefit plans of Hughes (other than
pensions) represent legally enforceable liabilities of Hughes.
NOTE 7.
As previously reported, Hughes has maintained a suit against the U.S.
Government since September 1973 regarding the Government's infringement and use
of a Hughes patent (the "Williams Patent") covering "Velocity Control and
Orientation of a Spin Stabilized Body," principally satellites. On June 17,
1994, the U.S. Court of Claims awarded Hughes damages of $114 million. Because
Hughes believed that the record supported a higher royalty rate, it appealed
that decision. The U.S. Government contending that the award was too high, also
appealed. On June 19, 1996, the Court of Appeals for the Federal Circuit
affirmed the decision of the Court of Claims which awarded Hughes $114 million
in damages, together with interest. The U.S. Government petitioned the Court of
Appeals for the Federal Circuit for a rehearing. That petition was denied in
October 1996. The U.S. Government then filed a petition with the U.S. Supreme
Court seeking certiorari. On April 21, 1997 the U.S. Supreme Court, citing a
recent decision it had rendered in a separate patent matter, remanded Hughes'
suit over the Williams Patent back to the Court of Appeals along with patent
cases involving other parties then pending before the U. S. Supreme Court, in
order to have the Court of Appeals determine whether the results of prior
proceedings in those cases are consistent with the U.S. Supreme Court's recent
decision in such other matter. The previous liability decision of the Court of
Claims in the Williams Patent matter, and its $114 million damage award to
Hughes, currently remain in effect pending reconsideration by the Court of
Appeals. Hughes is unable to estimate the duration of this reconsideration
process. While no amount has been recorded in the financial statements of
Hughes to reflect the $114 million award or the interest accumulating
thereon, a resolution of this matter could result in a gain that would be
material to the earnings of General Motors attributable to Class H common
stock.
* * * * * *
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HUGHES ELECTRONICS CORPORATION AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following management's discussion and analysis should be read in
conjunction with the Hughes management's discussion and analysis included in
GM's 1996 Annual Report to the SEC on Form 10-K. In addition, the following
discussion excludes the purchase accounting adjustments related to General
Motors' acquisition of Hughes Aircraft Company (see Supplemental Data beginning
on page 36).
Statements made concerning expected financial performance, ongoing financial
performance strategies, and possible future action which Hughes intends to
pursue to achieve strategic objectives for each of its three principal business
segments constitute forward-looking information. The implementation of these
strategies and of such future actions and the achievement of such financial
performance are each subject to numerous conditions, uncertainties and risk
factors, and, accordingly, no assurance can be given that Hughes will be able to
successfully accomplish its strategic objectives or achieve such financial
performance. The principal important risk factors which could cause actual
performance and future actions to differ materially from the forward-looking
statements made herein include economic conditions, product demand and market
acceptance, government action, competition, ability to achieve cost reductions,
GM's global sourcing strategy with respect to automotive electronics, General
Motors' North American Operations (GM-NAO) volumes, technological risk, and
interruptions to production attributable to causes outside Hughes' control.
Planned Transactions
On January 16, 1997, GM and Hughes announced a series of planned transactions
designed to address strategic challenges and unlock stockholder value in the
three Hughes business segments. The transactions would include the tax-free
spin-off of the Hughes defense business to holders of GM's $1-2/3 par value and
Class H common stocks, followed immediately by the tax-free merger of that
business with Raytheon Company. The spin-off will not be proposed in a manner
that would result in the recapitalization of Class H common stock into $1-2/3
par value common stock at a 120% exchange ratio, as currently provided for under
certain circumstances in the GM Restated Certificate of Incorporation, as
amended. At the same time, Delco Electronics, the automotive electronics
subsidiary of Hughes, would be transferred from Hughes to GM's Delphi Automotive
Systems unit. Finally, GM's Class H common stock would be recapitalized into a
GM tracking stock linked to the telecommunications and space business of Hughes.
No assurance can be given that the above transactions will be completed;
however, management of GM and Hughes and GM's Board of Directors expect to
solicit stockholders' approval of the planned transactions in late 1997, after
certain conditions are satisfied.
In September 1996, Hughes and PanAmSat Corporation entered into an agreement
to merge their respective satellite service operations into a new publicly-held
company. Hughes would contribute its Galaxy satellite services business in
exchange for a 71.5% interest in the new company. Current PanAmSat stockholders
would receive a 28.5% interest in the new company and $1.5 billion in cash. Such
cash consideration and other funds required to consummate the merger are
expected to be funded by new debt financing totaling $1.725 billion. This debt
financing is expected to be provided by Hughes, which currently intends to
borrow such funds from GM. The transaction is expected to close during the
second quarter of 1997.
Results of Operations
Hughes reported first quarter 1997 earnings of $235.2 million, compared with
$311.7 million reported in the first quarter of 1996. Excluding the 1996 first
quarter $71.6 million after-tax gain ($0.18 per share of GM Class H common
stock) from the sale of a 2.5% equity interest in DIRECTV(R) to AT&T, earnings
for the first quarter of 1997 decreased 2.0% from the $240.1 million reported in
the same period in 1996, and earnings per share decreased $0.01 per share from
$0.60 per share in the prior year period. The decline was principally due to
lower operating profit in the Telecommunications and Space and Automotive
Electronics segments, offset in part by the favorable impact of a lower
effective tax rate in the quarter.
Revenues for the first quarter of 1997 were $4,152.7 million, an 11.1%
increase from the $3,736.7 million reported in the first quarter of 1996. Costs
and expenses as a percentage of revenues increased to 91.7% from 86.5% in the
first quarter of 1996. Income taxes were $110.2 million, or 31.9% of income
before income taxes, for the first quarter of 1997 compared with $191.4 million,
or 38.0% of income before income taxes, in the comparable 1996 quarter.
Operating profit was $324.8 million for the quarter ended March 31, 1997, a
15.7% decrease from the operating profit of $385.2 million reported during the
comparable period in 1996. The operating profit margin was 7.9% for the first
quarter of 1997 compared with 10.7% in the first quarter of 1996.
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HUGHES ELECTRONICS CORPORATION AND SUBSIDIARIES
Telecommunications and Space segment revenues for the quarter ended March 31,
1997 were $1,023.4 million, an increase of 9.3% over revenues of $936.4 million
reported in the prior year's first quarter. Excluding the $120.3 million pre-tax
gain recognized from the sale of 2.5% of DIRECTV to AT&T in the first quarter of
1996, revenues increased 25.4%. The growth was primarily due to continued
expansion of the DIRECTV subscriber base in the United States and Latin and
South America and increased sales of commercial and government satellites which
more than offset the impact from lower Galaxy(R) satellite transponder sales.
Operating profit in the first quarter of 1997 was $7.2 million compared with
$74.5 million reported in the same period in 1996. This decrease was largely the
result of lower Galaxy transponder sales, start-up operating losses from the
Company's Latin and South American DIRECTV subsidiary, Galaxy Latin America, and
increased expenses resulting from the change in the amortization period for
DIRECTV subscriber acquisition costs related to a consumer rebate and
manufacturers' incentive program. The change in the amortization period for
DIRECTV subscriber acquisition costs resulted in a decrease in operating profit
of $35.8 million. As a result, first quarter operating profit margin
decreased to 0.7% in 1997 from 9.1% in 1996.
The Automotive Electronics segment reported first quarter 1997 revenues of
$1,447.0 million, an increase of 13.8% from revenues of $1,271.8 million for the
same period in 1996. The growth was principally due to a 20.5% increase in GM
vehicles produced in the United States and Canada (excluding joint ventures) and
a 12.2% increase in international and non-GM sales (from $245 million to $275
million) partially offset by a 5.9% decline in Delco-supplied electronic content
(from $929 to $874 per GM vehicle produced in the United States and Canada,
excluding joint ventures). Last year's first quarter performance was negatively
impacted by the 17 day work stoppages at two GM component plants in Dayton, Ohio
that temporarily shutdown 26 of 29 GM assembly plants in North America and
certain automotive component plants. Operating profit decreased 8.6% in the
first quarter to $145.6 million from $159.3 million in the comparable period in
1996. The decline was primarily due to price reductions resulting from
competitive pricing in connection with GM's global sourcing initiative and the
impact from continued international expansion which more than offset the
increased production volume benefits. The 1996 first quarter results included an
operating loss of approximately $50 million related to the work stoppage
described above. First quarter operating profit margin declined to 10.2% from
12.6% in 1996.
As the principal supplier of automotive electronics to GM-NAO, Hughes' sales
of automotive electronics will continue to be heavily dependent on General
Motors production of vehicles in North America, the level of Hughes-supplied
electronic content per GM vehicle, the price of such electronics, and the
competitiveness of Hughes' product offerings. In this regard, it is anticipated
that competition through GM's global purchasing process will negatively impact
Hughes' sales to GM-NAO and result in a decline in the portion of GM-NAO
automotive electronics supplied by Hughes. The segment's strategy is to
aggressively reduce costs in order to minimize the effect of continuing price
reductions and to manage the loss of GM-NAO market share by offering competitive
products which increase electronic functionality through a focus on safety,
security, communications, and convenience. The segment will also seek to improve
its systems capability and cost competitiveness both internally and by
developing key design, manufacturing, and marketing alliances and other
relationships with mechanical and electrical automotive component suppliers.
The international market for automotive electronic products is also highly
competitive. The segment has refined its strategy for this market to focus on
profitable growth as well as increased market share, and accordingly, will seek
to enhance the cost competitiveness of its international operations.
The competitive environment described above is making it increasingly
difficult to maintain the level of operating profit margins realized in this
segment in the past. Operating margins are expected to be lower than recent
historical levels as price and volume declines associated with GM's global
sourcing initiatives more than offset Hughes' ability to achieve cost
reductions. In response to the increased pressure on margins and to enhance
future competitiveness, management will take action to reduce the cost structure
of the business. As a result of the factors described above, the operating
margin is expected to remain at low double digits in 1997, and then show modest
improvement in 1998 and 1999.
The Aerospace and Defense Systems segment reported 1997 first quarter
revenues of $1,646.6 million, an 8.9% increase over revenues of $1,512.4 million
reported in the same period in 1996. The growth was principally due to
additional revenues resulting from the build-up of newer programs, particularly
information systems and services programs such as Desktop V, Wide Area
Augmentation System, and Hughes Air Warfare Center. Operating profit for the
first quarter of 1997 increased 9.8% to $173.4 million compared with $157.9
million for the first quarter of 1996 primarily due to these revenue increases.
The operating profit margin in the period remained unchanged at 10.5% as
compared to 1996. Future operating profits could be adversely impacted by
further reductions in the U.S. defense budget.
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HUGHES ELECTRONICS CORPORATION AND SUBSIDIARIES
Liquidity and Capital Resources
Cash and cash equivalents at March 31, 1997 were $893.0 million, a decrease
of $268.3 million from the $1,161.3 million reported at December 31, 1996. The
decrease was primarily due to the use of cash in operating activities of $281.6
million, capital expenditures, the acquisition of the Marine Systems Division of
Alliant Techsystems, Inc. for $143.3 million in cash, cash dividends paid to
General Motors, and the repayment of $100.0 million of short-term borrowings,
partially offset by proceeds of $487.5 million from short-term commercial paper
borrowings under an existing credit facility.
As a measure of liquidity, Hughes' current ratio (ratio of current assets to
current liabilities) of 1.68 at March 31, 1997 remained relatively unchanged
from 1.69 at December 31, 1996. Working capital increased to $2,965.1 million at
March 31, 1997 from $2,879.4 million at December 31, 1996.
Capital expenditures, including expenditures for telecommunications and other
equipment, were $160.9 million for the quarter ended March 31, 1997, compared
with $151.3 million for the comparable period in 1996 reflecting increased
expenditures in the Telecommunications and Space segment.
Long-term debt and capitalized leases were $31.3 million at March 31, 1997,
relatively unchanged from the $34.5 million at December 31, 1996. The ratio of
long-term debt and capitalized leases to the total of such debt and pro forma
stockholder's equity was 0.1% at March 31, 1997 and December 31, 1996.
Hughes expects 1997 cash requirements prior to the consummation of the
planned transactions to result in additional short-term borrowings of up to $800
million under new credit facilities. In addition, as described in Note 4 to the
Hughes Consolidated Financial Statements, Hughes expects to incur new long-term
debt of $1.725 billion in connection with the PanAmSat merger. Hughes currently
intends to borrow such funds from GM.
Security Ratings
On April 24, 1997, Standard and Poor's Rating Services, a division of
McGraw-Hill Companies, Inc., affirmed its security ratings of Hughes and
indicated that the security ratings outlook for Hughes remains developing.
Supplemental Data
The Consolidated Financial Statements reflect the application of purchase
accounting adjustments as previously discussed. However, as provided in GM's
Restated Certificate of Incorporation, as amended, the earnings attributable to
GM Class H common stock for purposes of determining the amount available for the
payment of dividends on GM Class H common stock specifically excludes such
adjustments. More specifically, amortization of the intangible assets associated
with GM's purchase of Hughes Aircraft Company amounted to $30.6 million for the
first quarters of 1997 and 1996. Such amounts were excluded from the earnings
available for the payment of dividends on GM Class H common stock and were
charged against the earnings available for the payment of dividends on GM's
$1-2/3 par value stock. Unamortized purchase accounting adjustments associated
with GM's purchase of Hughes Aircraft Company were $2,692.9 million at March 31,
1997 and $2,723.5 million at December 31, 1996.
In order to provide additional analytical data to the users of Hughes'
financial information, supplemental data in the form of unaudited summary pro
forma financial data are provided. Consistent with the basis on which earnings
of Hughes available for the payment of dividends on the GM Class H common stock
is determined, the pro forma data exclude purchase accounting adjustments
related to General Motors' acquisition of Hughes Aircraft Company. Included in
the supplemental data are certain financial ratios which provide measures of
financial returns excluding the impact of purchase accounting adjustments. The
pro forma data are not presented as a measure of GM's total return on its
investment in Hughes.
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HUGHES ELECTRONICS CORPORATION AND SUBSIDIARIES
UNAUDITED SUMMARY PRO FORMA FINANCIAL DATA*
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF INCOME
Three Months Ended
March 31,
1997 1996
(Dollars in Millions
Except Per Share Amounts)
Total Revenues $4,152.7 $3,736.7
Total Costs and Expenses 3,807.3 3,233.6
------- -------
Income before Income Taxes 345.4 503.1
Income taxes 110.2 191.4
----- -----
Earnings Used for Computation of Available Separate
Consolidated Net Income $235.2 $311.7
Earnings Per Share Attributable to General Motors Class H
Common Stock $0.59 $0.78
==== ====
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
March 31, December 31,
ASSETS 1997 1996
(Dollars in Millions)
Total Current Assets $7,312.6 $7,079.0
Property - Net 2,879.4 2,886.6
Telecommunications and Other Equipment - Net 1,168.4 1,133.5
Intangible Assets, Investments, and Other Assets - Net 2,688.5 2,657.5
--------- ---------
Total Assets $14,048.9 $13,756.6
======== ========
LIABILITIES AND STOCKHOLDER'S EQUITY
Total Current Liabilities $4,347.5 $4,199.6
Long-Term Debt and Capitalized Leases 31.3 34.5
Postretirement Benefits Other Than Pensions,
Other Liabilities, and Deferred Credits 3,075.9 3,066.1
Total Stockholder's Equity ** 6,594.2 6,456.4
--------- ---------
Total Liabilities and Stockholder's Equity ** $14,048.9 $13,756.6
======== ========
* The summary excludes purchase accounting adjustments related to GM's
acquisition of Hughes Aircraft Company.
** General Motors' equity in its wholly-owned subsidiary, Hughes. Holders of GM
Class H common stock have no direct rights in the equity or assets of
Hughes, but rather have rights in the equity and assets of GM (which
includes 100% of the stock of Hughes).
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HUGHES ELECTRONICS CORPORATION AND SUBSIDIARIES
UNAUDITED SUMMARY PRO FORMA FINANCIAL DATA* - Continued
PRO FORMA SELECTED SEGMENT DATA
Three Months Ended
March 31,
1997 1996
(Dollars in Millions)
Telecommunications and Space
Revenues $1,023.4 $936.4
Revenues as a percentage of Hughes Revenues 24.6% 25.1%
Net Sales $1,018.8 $821.0
Operating Profit (1) $7.2 $74.5
Operating Profit Margin (2) 0.7% 9.1%
Depreciation and Amortization (3) $50.3 $46.2
Capital Expenditures (4) $94.0 $70.3
Automotive Electronics
Revenues $1,447.0 $ 1,271.8
Revenues as a percentage of Hughes Revenues 34.8% 34.0%
Net Sales $1,433.9 $1,260.2
Operating Profit (1) $145.6 $159.3
Operating Profit Margin (2) 10.2% 12.6%
Depreciation and Amortization $56.2 $48.8
Capital Expenditures $35.9 $50.3
Aerospace and Defense Systems
Revenues $1,646.6 $1,512.4
Revenues as a percentage of Hughes Revenues 39.7% 40.5%
Net Sales $1,644.8 $1,502.2
Operating Profit (1) $173.4 $157.9
Operating Profit Margin (2) 10.5% 10.5%
Depreciation and Amortization (3) $37.0 $32.7
Capital Expenditures $30.3 $28.5
Corporate and Other
Operating Loss (1) $(1.4) $(6.5)
* The summary excludes purchase accounting adjustments related to GM's
acquisition of Hughes Aircraft Company.
(1) Net Sales less Total Costs and Expenses other than Interest Expense.
(2) Operating Profit as a percentage of Net Sales.
(3) Excludes amortization arising from purchase accounting adjustments related
to GM's acquisition of Hughes Aircraft Company amounting to $5.3 million for
the Telecommunications and Space segment and $25.2 million for the Aerospace
and Defense Systems segment in 1997 and 1996.
(4) Includes expenditures related to telecommunications and other equipment
amounting to $57.6 million and $16.0 million in 1997 and 1996, respectively.
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HUGHES ELECTRONICS CORPORATION AND SUBSIDIARIES
UNAUDITED SUMMARY PRO FORMA FINANCIAL DATA* - Concluded
PRO FORMA SELECTED FINANCIAL DATA
Three Months Ended
March 31,
1997 1996
(Dollars in Millions
Except Per Share Amounts)
Operating profit $324.8 $385.2
Income before income taxes $345.4 $503.1
Earnings used for computation of available separate
consolidated net income $235.2 $311.7
GM Class H dividend base shares (1) 399.9 399.9
Stockholder's Equity $6,594.2 $5,898.6
Dividends per share of GM Class H common stock $0.25 $0.24
Working capital $2,965.1 $3,035.5
Operating profit as a percent of net sales 7.9% 10.7%
Pre-tax income as a percent of net sales 8.4% 13.9%
Net income as a percent of net sales 5.7% 8.6%
* The summary excludes GM purchase accounting adjustments related to the
acquisition of Hughes Aircraft Company.
(1) GM Class H dividend base shares is used in calculating earnings per share
attributable to GM Class H common stock. This is not the same as the average
number of GM Class H shares outstanding, which was 100.4 million for the
first quarter of 1997 and 97.4 million for the first quarter of 1996.
* * * * * *
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